Best Buy Tablet Doomed?

Rich Tehrani : Communications and Technology Blog - Tehrani.com
Rich Tehrani
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Best Buy Tablet Doomed?

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The common sense analysis of Best Buy’s new Android-based tablet is it is doomed because if only Amazon is able to pull a tablet off by breaking even or even potentially losing money and even Samsung isn’t making a dent in the market, how can Best Buy do any better? The reality is the success of this strategy is a long shot but by the same token you can think of this tablet as a generic product or store brand.

In other words when you go to Costco and buy a Kirkland product you are essentially buying a “store brand” not necessarily manufactured by the retailer, just resold. So Best Buy’s Insignia Flex tablet expected to sell between $239 and $259 can simply be considered a new product in the house-brand category.

If the company decided to spend millions of R&D dollars on this initiative, it is likely a huge mistake.

The new tablet will hit stores on November 11, features a dual-core 1GHz processor, 9.7-inch screen and 10-hour battery life, have a front facing camera and weigh about a pound-and-a-half.

Best Buy is losing its customers to Amazon – this is no surprise. What should also be no surprise is every company believes they need to compete with Apple by being Apple. Google is now a tablet and smartphone manufacturer. Microsoft is now a tablet manufacturer and is trying to sell via more and more retail stores. Amazon may get into the processor business.

In short, companies believe they have to be Apple to make it going forward.

To some degree they are 100% correct. The problem is it is very tough to be Apple and few companies will be as successful at all aspects of their business.

But for Best Buy there are few other strategies left beyond Amazon price match and if the tablet market is indeed the future of tech and the post-PC era is here to stay, they are at least playing in a fast-growing market and even gaining a small amount of market-share could bring in significant revenue.



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